Full question:
We want to form an LLC to own rental property we recently purchased in Florida. My question pertains to what type of LLC should we form. I have been informed by those in real estate that forming an LLC in Florida or forming a foreign LLC that operates in Florida are not required since you are not doing 'business' in Florida. Apparently 'business' refers to buying and selling goods as it relates to commerce. Please confirm if my understanding is correct. Advantage to form LLC in our home state is that it doesn't require us to have a registered agent in Florida. Please advise.
- Category: LLC
- Date:
- State: Texas
Answer:
The legal definition of doing business in quite broad, and renting property would be included in many cases, not just buying and selling goods. It is possible to form an LLC in another state to protect the property in FLorida. The answer will depend on all the facts involved. For example, many single-member LLCs choose to form an LLC in a jurisdiction like Delaware that offers greater protection to single member LLCs.
All LLCs organized outside of Florida must register with the Florida Secretary of State to do business in Florida. Foreign LLCs must appoint a registered agent for service of process physically located in Florida. To register, file an Application By Foreign Limited Liability Company For Authorization To Transact Business In Florida with the Florida Department of State Division of Corporations. The completed application must be accompanied by a Certificate of Existence from the foreign LLC’s home state, dated nor more than 90 days prior to the filing of the certificate.
You must first check the LLC’s name is available in Florida by checking the Florida Division of Corporations business name database. If the name is not available, the foreign LLC must use an alternate name for use in Florida and submit a signed copy of the consent or resolution of its managers or managing members adopting the alternate name.
For the fictitious name requirement, 'Doing Business' is defined to mean any enterprise or venture in which a person sells, buys, exchanges, barters, deals, or represents the dealing in any thing of value, or renders services for compensation.
Exemptions from filing of a fictitious name are as follows:
When the applicant is a licensed attorney forming a business for the practice of law in the State of Florida.
When the applicant is registered with the Department of Business and Professional Regulations and their licensing board has not imposed requirements for the registration of a fictitious name.
When the applicant is a corporation or limited partnership filed and in good standing with the Division of Corporations and is not conducting business under any other name.
When the applicant is a federally chartered corporation and is not conducting business under any other name.
When the applicant is using their full name in the title and they are the only owner.
We are prohibited from giving legal advice. We suggest you contact a local attorney who can review all the facts and documents involved.
See also:
http://www.stateofflorida.com/Portal/DesktopDefault.aspx?tabid=8
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.
